Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search


Lesson for NZ in Greenspan's flawed worldview

Alliance Party says a lesson for New Zealand in Greenspan's flawed worldview

Alliance Party media release FOR IMMEDIATE RELEASE Saturday 25 October 2008

Alliance co leader Kay Murray says recent comments made by Alan Greenspan, former chairman of the US Federal Reserve, demonstrate that the world should not be run by economists and financiers.

"Mr Greenspan has claimed he was shocked at the extent of financial institutions risk taking that occurred under his term, now that the extent of the financial disaster has become apparent. He genuinely believed that the desire by institutions to protect their reputations, presumably by remaining solvent, would override the desire to make as much money as possible."

In what must be the understatement of the century so far Mr Greenspan is reported to have said there was a "flaw in the model of how I perceived the world works"

"Where has this man been all his life?" asks Ms Murray.

"Any student of psychology, sociology, or even history, could have told Mr Greenspan the likely result of deregulating the speculative, gambling culture that dominates the financial markets - which has been a breakdown of all restraint and responsibility in favour of short term plundering."

Mr Greenspan has explained that the public must not "expect infallibility" of government officials.

"With the multimillion dollar salary package that he would be getting whilst in the Federal Reserve, the public would be perfectly justified in expecting Mr Greenspan to walk on water," says Ms Murray.

Ms Murray says there is an important message here for New Zealanders in the upcoming elections.

"Do not assume that men in flash suits with big salaries, spouting facts and figures, models and theories, necessarily know what they're talking about."

"There may be a small 'flaw in the model of how they perceive the world works' that could be as devastating to New Zealand's economy as Alan Greenspan's was to the US economy."

Ms Murray says when the global economic crisis hits New Zealand, as it certainly will, it will be important for the government to be controlled by people who truly understand how the world works, not just how the financial institutions would like it to work.

These people will have to be able to prioritize spending so that costs are reduced but areas like health, education and social services, which are vital to the well being of all New Zealanders, are not touched, she says.

"Previous experience in areas such as health, education or social services and working on shoe string budgets, will be much more relevant than speculation in the casino economy."

Ms Murray says the Alliance is a party of real people with rich and varied life experiences who know how the real world works.

"We have the policies and the political will to minimize the effects of the global economic crisis. The Alliance knows that the financial institutions and global corporations are largely motivated by greed and selfishness. We do not expect them to look after anyone's interests except their own."

The Alliance will not be afraid to legislate and regulate to curb their excesses and make them into responsible citizens, she says.

The Alliance will ensure that any belt tightening and cost cutting that may be necessary, starts at the top, and that, unlike the tough times in the 1980's, those on middle and low incomes will not be the ones to bear the brunt of the economic downturn.


© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines

Not Easy: Gordon Campbell On The Greens’ Ongoing Problems

Hard to treat the Greens’ belated decision to stand a candidate in Ohariu as being anything other than a desperation move, by a party whose own leadership is evidently concerned about its chances of survival...

A few months ago, the Greens felt able to forego that role in Ohariu in order to help a beleaguered Labour Party get its candidate Greg O’Connor across the line, and knock Peter Dunne out of the parliamentary frame. More>>


Closing The Gap: Ardern Rules Out Income Tax Rise

After earlier commitments by Jacinda Ardern to do something about inequality and poverty, this new position on income tax seems an about face. To do something significant about inequality requires increases in income for those at the bottom and decreases for those at the top... More>>


Gordon Campbell: On DHB Deficits And Free Trade

Currently the world is looking on aghast at the Trump administration’s plans to slash Obamacare, mainly in order to finance massive tax changes that will deliver most of their gains to the wealthy. Lives will be lost in the trade-off. Millions of Americans stand to lose access to the healthcare they need... More>>

Greens' Response: Slum-Like Rentals Exposed In Renting Review

“...The grim findings of the review are a wakeup call about the true state of rentals in this country. Too many renters are festering in slum-like conditions under the thumb of landlords who have largely unchecked powers and ignore tenants’ complaints when it suits them.” More>>


Gordon Campbell: On The Life And Times Of Peter Dunne

The unkind might talk of sinking ships, others could be more reminded of a loaded revolver left on the desk by his Cabinet colleagues as they closed the door behind them, now that the polls in Ohariu had confirmed he was no longer of much use to National. More>>


Gordon Campbell: On Labour’s Campaign Launch

One of the key motifs of Ardern’s speech was her repeated use of the phrase – “Now, what?” Cleverly, that looks like being Labour’s response to National’s ‘steady as it goes’ warning against not putting the economic ‘gains’ at risk. More>>


Lyndon Hood: Social Welfare, Explained

Speaking as someone who has seen better times and nowadays mostly operates by being really annoying and humiliating to deal with, I have some fellow feeling with the current system, so I’ll take this chance to set a few things straight.. More>>





Featured InfoPages

Opening the Election